Reuters writer Christopher Doering reported yesterday that, “President George W. Bush opposes raising taxes to pay for increases in several programs in the new U.S. farm law, the top U.S. agriculture official said on Wednesday, as he underscored crafting a new farm bill as his top priority while in office.
“Agriculture Secretary Ed Schafer, in his first sit-down with reporters since he was confirmed on Monday, said President Bush has told him now is the time to act on farm policy.”
Reuters news reported yesterday that, “Brazil’s President Luiz Inacio Lula da Silva proposed to U.S. President George W. Bush a meeting of world leaders to help conclude global trade talks, a government spokesman said on Tuesday.
“Lula telephoned Bush on Tuesday and suggested the meeting take place in April, when both leaders are expected to be in Europe, Marcelo Baumbach, the president’s spokesman, told reporters.”
Iowa State University Agricultural Economist Chad E. Hart, writing recently in the Iowa Ag Review (“The Outlook for Corn and Ethanol”) noted that, “The continuing expansion of the ethanol industry is just one of several positive signs for the corn market. Corn usage for ethanol continues to grow and set records each year. Ethanol will become the second-largest use of U.S. corn this year, trailing only domestic livestock feeding. The growth in corn demand due to ethanol has been met with increased acreage devoted to corn and higher production. Over the past two years, the United States has raised two solid corn crops–10.5 billion bushels in 2006 and a record 13.2 billion bushels in 2007–yet corn prices have continued to rise. While ethanol has been a driving factor, corn exports have also helped the strong price outlook. The latest USDA projections put corn exports for the 2007/08 marketing year at 2.45 billion bushels. That would be a record for corn exports, exceeding the previous record of 2.4 billion bushels for 1979/80. Cumulative export sales for the current marketing year are nearly 65 percent that of the USDA projection, well ahead of the average pace over the last five years of being at roughly half of the export projection. Outstanding export sales also show a brisk corn export pace.
“The main factor supporting export sales is the relative weakness of the U.S. dollar. Table 2 shows the relative change in the value of the dollar in comparison with other currencies. Over 2007, the value of the dollar fell against many world currencies. A falling dollar makes our exports look relatively more attractive to importers and often spurs export demand. The effect for corn is twofold. First, the dollar depreciated against the real and yuan, the currencies of two of our major corn export competitors, Brazil and China. So U.S. corn is relatively less expensive than Brazilian or Chinese corn. Second, the dollar also depreciated against the currencies of corn importers, such as Japan, making U.S. corn relatively less expensive to import.
(NOTE: The original version of this update contained erroneous links, this update has been CORRECTED).
Reuters writers Sam Cage and Jonathan Lynn reported on Saturday that, “Rich and poor countries aim to meet around Easter to try to seal a long- elusive global trade deal before U.S. President George W. Bush leaves office, ministers said on Saturday.
“A trade deal would inject much-needed confidence into a troubled world economy, and help ward off protectionist trends, ministers said.
“‘We have a window of necessity which is also a window of opportunity,’ Brazil’s Foreign Minister Celso Amorim said.”
Kevin Bouffard, writing today at The Ledger Online (Lakeland, Fla.) reported that, “For the first time, Florida agriculture has a stake in the federal Farm Bill debate, and the acting U.S. Agriculture Secretary came to Winter Haven on Thursday night to encourage the state’s growers to raise their voices.
Recall that on March 2, 2007, EU Commissioner for Agriculture Mariann Fischer Boel posted an update to her blog, which stated in part that, “Next week, EU leaders meet for their spring summit. High on the agenda are the Commission’s proposals to set binding targets for the use of renewable energy. We want 20 percent of energy use to come from renewables by 2020 and 10 percent of transport fuel to be biofuels.
“I sincerely hope the presidents and prime ministers around the table sign up to this. Politicians have to take the lead and I for one am convinced that it is only through mandatory targets that people will be forced into changing their habits.”
Bob Meyer, writing yesterday at Brownfield, reported that, “House Ag Committee Chair, Collin Peterson says there are a lot of negotiations going on over the farm bill. ‘Lots of staff meetings going on the last couple of weeks and we are making significant progress in a number of areas.’ However, there remains a big difference among the parties as to how the bill will be paid for.”
The European Commission (EC) issued a news update yesterday, which stated in part that, “EU Trade Commissioner Peter Mandelson and US Trade Representative Susan Schwab have met in Brussels to discuss a wide range of bilateral trade issues as well as progress in the WTO Doha trade talks. The two sides also discussed relations with major emerging economies, as well as the contribution of trade policy to mitigation of climate change.”
Reuters writer Paul Taylor reported late last week that, “The European Commission will spell out next week, over the din of protests from industry and governments as well as green groups, how it intends to cut greenhouse gas emissions to fight climate change.”
DTN writer Chris Clayton reported yesterday that, “Like a critical day for income-tax filers, farmers and those backing new provisions in the farm bill may want to circle April 15 as a ‘bottom-line date’ for getting the farm bill done because after that date, budget projections for the legislation could change dramatically, the chairman of the Senate Budget Committee said Friday.
“Sen. Kent Conrad, D-N.D., also a member of the Senate Agriculture Committee, told DTN in an interview that the Congressional Budget Office projections in mid-April would likely tighten the clamps on the farm bill’s budget baseline, further miring negotiations on the bill.”
“‘The fact is we are going to have to come up with some more money above baseline,’ said Harkin. ‘The administration, I’m sure, at some point will come forward and recommend where we get the money. They haven’t yet. Then we will counter that and we will work it out. I hope they are not totally inflexible on some of the revenue portions we’ve got on the Senate side. That would not be good to have an inflexible position on that.’”
Congressional Quarterly writer Catharine Richert reported yesterday that, “Legislative language that would upend a longstanding trade agreement with Mexico to favor U.S. sugar growers is being circulated among House and Senate lawmakers involved in writing the 2007 farm bill.
“Under the 1993 North American Free Trade Agreement, Mexico could export sugar to the United States tariff-free starting Jan. 1, 2008, ending quotas and costs associated with the trade, potentially creating a glut of sugar here.”
Yesterday, the U.S. Department of Agriculture’s Economic Research Service (ERS) indicated in their monthly Feed Outlook report that, “With reduced ending stocks, the 2007/08 projected price range of corn is up 35 cents on both ends of the range to $3.70-$4.30 per bushel.